Today’s governmental decisions have amazing similarity to those of leaders in the 1920s, ’30s and ’40s

Created Tuesday, 26 October 2010 20:40

RECON

Real Estate Center Online News October 26, 2010 Copyright 2010. All rights reserved. Material herein is published according to the fair-use doctrine of U.S. copyright laws related to non-profit, educational institutions. Items attributed to sources other than the Real Estate Center at Texas A&M University should not be reprinted without permission of the original source.

THE MORE THINGS CHANGE . . .

COLLEGE STATION (Real Estate Center) – If you think today’s U.S. economy is something new, you need to watch our new 17-minute video, “The Pendulum.”

In part one of this three-part series, Chief Economist Dr. Mark Dotzour travels back in time to show that today’s governmental decisions have amazing similarity to those of leaders in the 1920s, ’30s and ’40s.

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The Confusion Over Inflation and Deflation Explained

Created Saturday, 16 October 2010 14:43

RECON
Real Estate Center Online News
October 15, 2010
Copyright 2010. All rights reserved.
Material herein is published according to the fair-use doctrine of U.S. copyright laws related to non-profit, educational institutions. Items attributed to sources other than the Real Estate Center at Texas A&M University should not be reprinted without permission of the original source.

AN INFLATION-DEFLATION PRIMER

 

COLLEGE STATION (Real Estate Center) — If you haven’t heard about them, you haven’t been reading, listening or watching the news. Few Americans can define them, much less explain their differences. Mark Dotzour and Gerald Klassen help clear the confusion over inflation and deflation in a four-page white paper released earlier this week.

Which is worse, inflation or deflation?

“Deflation is much worse because it leads to falling profits and asset values,” said Dotzour, chief economist for the Real Estate Center at Texas A&M University. “When profits and asset values fall, people go bankrupt. However, deflation is beneficial for those on fixed incomes with no debt because their money buys more. Deflation results in lower interest rates.”

Is real estate a good investment during deflation?

“The answer depends on how much equity you have,” said Klassen, the Center’s research analyst. “During deflation, commercial rents will fall, and some tenants will go out of business because of falling profits. The most important thing when buying real estate during deflation is to avoid the need to go back to the bank to get relief on the mortgage payment.”

Dotzour and Klassen address other fundamental questions in their new paper. What is the best investment strategy during deflation? How does deflation affect mortgage rates? What is the best way for the United States to end deflation and get the economy going again? What could cause this strategy to fail?

The complete paper is available on the Center’s website.

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Abilene Balloon Festival 2010

Created Friday, 01 October 2010 14:36

Abilene Balloon Festival 2010

 

So, who would have thought it – we drove to Abilene last weekend for the West Texas Book and Music Festival, and found – when the books were packed up and the music had ended, there was still a lot going on in Abilene. There was the Abilene balloon festival going on as well; and late Saturday afternoon, balloon owners, pilots and crews were arriving every minute in the park, pulling in with their pickup trucks, towing small trailers and setting up their balloons. A whole forest of classic tear-drop shaped balloons sprouted at anchor – gaily multicolored, bobbing gently in the air as jellyfish bob and sway in their element.

The weather was chancy in Abilene last weekend, so they could only actually launch two balloons; the evening was fine, mild and clearing, but apparently if you are going for a balloon ride, best to launch before 4 PM; it seems that landing and folding up the balloon in the dark are not a process eagerly embraced by the average recreational hot-air balloon pilot.

It was fascinating, watching how deftly and quickly a balloon can be deployed, though: first the basket came out of the storage/travel trailer: always a heavy-duty wicker rattan basket, although many of the ones I saw had bottoms which appeared to be reinforced with plywood. Attached the metal supports at the corners of the basket, attach the propane burners across the top of the frame, and then bring out the fabric envelope, unrolling it across the grass, and attaching the lines to the basket frame, which lays on it’s side.

They inflate the envelope using a gas-powered super fan, first – and only when it’s filled enough to stay open, that’s when the propane burner comes into play with a roar like a thousand blow-torches. The blast of super-heated air from it inflates the envelope farther, to the point where it lifts off the ground; that’s when the ground crew tips the basket upright . . . and the point when the balloon needs to be firmly tied up to something large and heavy.

The sun was setting, as the last of the balloons were filled and made ready for an evening static display. The propane burners, lit occasionally to keep them upright and properly deployed made the balloon envelopes glow from the inside like Japanese paper lanterns. There was a live band playing all this time, mostly covers of old rock hits, like the Doors “Love Her Madly” and a whole fairway row of food vendors’ trailers: everything from hot dogs, to smoked turkey legs, and cheesecake onna stick. (Cheesecake onna stick? What will they think of next – chicken-friend bacon? Oh, wait.)

Kids were playing on the grass, running for tee-shirts being shot out of the tee-shirt cannon, dogs and their people were also wandering around . . . I couldn’t help thinking that there was something still right with the world, that enthusiasts could still bring their balloons to a park in Texas, and that kids could still get cotton candy on the fairway, and the sun could set in a clear sky after a day of rain.

 

 

 

 

 

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